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March 08, 2010

Will Patent Holder IV Show Its Face to Kodak?

[Zusha Elinson]

Kodak is trying to draw large patent hoarder Intellectual Ventures into court.

With its 30,000 patents and opaque veil of mystery, IV has shied away from the courts, likely because an allergy to discovery. But with its new money making scheme of selling patents to trolls who then file lawsuits (free reg. req.), you knew that IV would eventually end up in a courtroom.

3. IV co-founder Peter Detkin told me last year that IV is now cutting deals where it sells patents and takes a cut of any money made by filing lawsuits (free reg. req.). So it seemed like IV might have struck such a deal with Picture Frame and Niro.

Kodak’s lawyers at Jones Day want IV to be present at a settlement (.pdf) conference with Picture Frame because “published reports indicated that IV had a stake in the outcome of this case.”

Kodak’s lawyers say they want IV there so they can find out if the patent hoarder intends to kill them with a thousand proxy paper cuts.

“Kodak should be accorded the right to sit down across the table from IV as well as PFI, so that it can inquire as to IV’s intentions,” Jones Day lawyers write. “It should come as no surprise that Kodak’s attitude towards settlement may be affected by learning whether or not this case is the first of a series of patent litigation salvos to be launched against it by IV, whether directly or through a proxy like PFI.”

On Feb.17, Judge George Lindberg from the Northern District of Illinois agreed and ruled that IV should be present. But the judge changed his tune a little on Feb. 24, writing that “As stated in open court, while Intellectual Ventures is encouraged to attend the parties' face−to−face settlement conference, it is not ordered to be present.”

So will the patent hording giant show? I sent an email to IV and will let you know when I hear back. UPDATE: "At this point, we haven’t made a decision yet. We don’t know what Kodak wants or why they want us there. We don’t have a say in the litigation nor do we have control over Picture Frame Innovation or the patent," said an IV spokesperson.

The sides are also fighting over weather Picture Frame’s relationship with IV should be kept under seal. The briefing outlines some of the deal terms, all of which essentially say that IV has no control over what Niro does with the patent it sold him. But it doesn’t answer the big question: what kind of cut does IV get from the lawsuit?